SEIU suffers more setbacks on fight for $15

By Richard McCarty

For the past several years, the Service Employees International Union (SEIU) has been dumping millions of dollars of its members’ money into efforts across the country to hike the minimum wage to $15. The membership of SEIU includes many lower-wage workers, such as janitors, security guards, home care workers, and graduate students. Last year alone, SEIU spent $19 million on its Fight for $15 campaign. Is this a good use of SEIU members’ money?

In June of 2014, the Seattle City Council voted to raise the minimum wage in a series of steps to $15 (with annual increases for inflation after the minimum wage reaches $15). Later that year, the city signed a five-year contract with the University of Washington (UW) to study the effects of the wage increase. The first minimum wage increase of the series took effect in April of 2015. UW researchers found that increase had little impact, which may have been because many businesses were already paying above the minimum wage. The second increase took effect in January of 2016. This time, UW researchers found that the wage hike negatively impacted workers. In fact, that minimum wage increase caused the average low-wage worker’s income to fall by $125 a month, and the wage increase led to about 5,000 fewer jobs in the city. And Seattle isn’t done yet; the next wage hike takes effect in January of next year.

As inconvenient as the UW study is for SEIU and its Fight for $15 campaign, that’s not the only bad news for them: over the past year, three states have rolled back local minimum wage hikes.

The St. Louis Board of Aldermen voted to increase the minimum wage in August of 2015, but the minimum wage increase did not take effect until May of this year due to a lawsuit. The state legislature was displeased with the city’s action, in part because it wants a uniform minimum wage across the state. So, the legislature passed a bill to ban local minimum wages. After the UW study was released, the governor of Missouri announced that he would allow the bill to become law reversing St. Louis’s wage hike.

Between late 2015 and early 2017, five Iowa counties passed local minimum wage hikes. Once again, state legislators disapproved of the measures, and passed legislation to ban local governments from setting a minimum wage. The governor quickly signed the bill reversing the minimum wage hikes, but before he did 10 city councils voted to opt out of their county’s minimum wage increases.

In 2014, the City of Louisville, Kentucky voted to hike the minimum wage; the next year, the City of Lexington, Kentucky followed suit. However, just last fall, the state Supreme Court ruled — nearly unanimously — that cities in Kentucky lack the authority to increase the minimum wage.

With all of these setbacks — and with new evidence that minimum wage hikes are hurting those that are supposed to be helped — maybe SEIU should stop spending so much time and money playing politics and focus its efforts on representing its members.

Richard McCarty is the Director of Research at Americans for Limited Government Foundation.